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Your five-year-old VLCC is worth just over $14m
less than it was worth in February – can we con-
vince you that this may not be such a bad thing?
The value of a five-year-old VLCC of 305,000 dwt
was assessed on Monday at just over $65.0m, ac-
cording to Baltic Exchange data. This figure is
$3.4m below the estimate made seven days pre-
viously.
Indeed, VLCC asset values seem to have fallen
off a cliff. On February 22, the Baltic estimated
the benchmark VLCC’s value at $79.3m, and its
value has slumped since then, with depreciation
gathering pace from mid-May. Why?
For answers, look at the secondhand market,
some 12 VLCC deals have been completed
since January 1, at an average value of $56m
per vessel, research from Deutsche Bank says. This
is 25% below last year’s average.
On June 23, Teekay Corp reportedly sold its five-
year-old Korean-built VLCC Shoshone Spirit
(314,000 dwt) to Pantheon Tankers for $62m. An-
other VLCC of the same age and build – Hanjin
Ras Tanura (318,000 dwt) – achieved $75m when
sold by Hanjin to Bahri in late February.
But Deutsche Bank said depressed asset values
are a good thing for the VLCC market because
they disincentivise new ordering. Indeed, there
have been orders for just five firm VLCCs this year
to date, compared to 39 in the same period last
year (excluding options and cancellations).
The current orderbook isn’t expected to have an
impact on fleet utilisation until the first half of
2017, which the bank said the low net fleet
growth in the interim could support an
“elongated crude tanker upcycle, which has
positive implications in the 2018/19 timeframe”.
ALIBRA Weekly Market Report
May 17th, 2016
Some key figures:
VLCCs: Don't stop believing
Some key figures: $84.75m 2016 YTD $96m 2015 YTD
2016 YTD: 7
2015 YTD: 41 Number of VLCC newbuildings
ordered (including options)
ALIBRA Weekly Market Report
01 July 2016
Highest price achieved for resale
contract for Korean-built VLCC for
delivery the same year
2016 YTD: 1 2015 YTD: 1
Number of VLCCs demolished
ALIBRA Weekly Market Report - 01 July 2016
Private and Confidential - ALIBRA Shipping Ltd. 2016 2
COMMENT
The fears of a downwards movement in oil
price due to Brexit have not materialised,
with Brent hitting 50 dollars/bbl earlier this
week. Wheat on the other hand had a
noticeable decline this week reaching
$426.
$100
$150
$200
$250
$300
$350
$400
06/15 08/15 10/15 12/15 02/16 04/16 06/16
HOUSTON ROTTERDAM SINGAPORE FUJAIRAH
$0
$100
$200
$300
$400
$500
$600
$700
$25
$35
$45
$55
$65
$75
06/15 08/15 10/15 12/15 02/16 04/16 06/16
CRUDE (WTI) CRUDE (BRENT) IRON ORE (PLATTS)
COAL (RB INDEX) WHEAT (CBT)
0
20
40
60
80
100
120
140
1
1.1
1.2
1.3
1.4
1.5
1.6
06/15 08/15 10/15 12/15 02/16 04/16 06/16
GBP / USD EUR / USD USD / JPY
Bunker prices
COMMENT
Since last Friday's massive drop in sterling's
value, the GBP/USD exchange rate has
seen large fluctuations between the
1.31468 & 1.35188 levels and this morning
stands at 1.33162. Meanwhile, the euro to
pound rate has also stabilised at 1.11044
following attempts by the UK government
to soothe the Brexit-related panic.
COMMENT
IFO 380 & MGO prices still continue
moving upwards for all the main bun-
kering stations across the board. The
current demand and forecasts seem to
keep the rates high.
PORT 380 CST MGO
HOUSTON 247.0 483.5
ROTTERDAM 244.0 432.5
SINGAPORE 258.5 450.0
FUJAIRAH 258.5 526.0
COMMODITY PRICE LAST WEEK (+/-)
CRUDE (WTI) 48.32 0.19
CRUDE (BRENT) 49.50 -0.7
IRON ORE (PLATTS) 54.20 2.5
COAL (RB INDEX) 58.80 -2.8
WHEAT (CBT) 426.00 -32
CURRENCY PAIR PRICE
GBP / USD 1.33162
EUR / USD 1.11044
USD / JPY 102.568
USD / KRW 1145.49
Commodity prices
Currency prices
ALIBRA Weekly Market Report - 01 July 2016
Private and Confidential - ALIBRA Shipping Ltd. 2016 3
Dry bulk
SIZE
PERIOD
HANDY (32k dwt) 6,500 5,000 5,800 5,000 5,450 5,200
SUPRA (56k dwt) 7,100 5,700 5,950 6,000 5,550 5,100
ULTRA (62k dwt) 7,150 5,900 6,150 5,600 5,650 5,500
PANA/KMAX (76k-82k dwt) 7,200 6,000 6,100 5,500 6,500 6,200
CAPE (170k dwt) 9,100 9,100 8,500 8,500 8,800 8,800
6 MOS 1 YR 2 YR
* Arrows only indicate the movement compared to the past week hence not necessarily the market trends.
ATL PAC ATL PAC ATL PAC
SIZE THIS WEEK LAST WEEK CHANGE (+/-)
HANDYSIZE 342 322 20
SUPRAMAX 619 577 42
PANAMAX 662 569 93
CAPESIZE 996 897 99
BDI 660 596 64
BALTIC DRY INDEX
COMMENT
Short-term PANA rates have seen a surge this week, having reached their highest levels in
over a month.
The decrease in NATL tonnage supply and the increase in dry cargo movement between
the FEAST and AUS have been the two main causes behind this surge.
Supras’ average weighted TC rates jumped up by almost 5% this week to around $6,200/
day, when compared to a week ago, decreased tonnage in SEA and FE being the main
factor, even though UKC and MED volumes were low.
0
500
1000
1500
2000
06/15 08/15 10/15 12/15 02/16 04/16 06/16
Baltic Dry Index
HANDYSIZE SUPRAMAX PANAMAX CAPESIZE BDI
DRY TIME CHARTER ESTIMATES (pdpr)
ALIBRA Weekly Market Report - 01 July 2016
Private and Confidential - ALIBRA Shipping Ltd. 2016 4
0
4,000
8,000
12,000
16,000
20,000
07/15 09/15 11/15 01/16 03/16 05/16 07/16
6 Months Atlantic TC Rates ($/day)
HANDYSIZE SUPRAMAX PANAMAX CAPESIZE
0
4,000
8,000
12,000
16,000
20,000
07/15 09/15 11/15 01/16 03/16 05/16 07/16
6 Months Paci fic TC Rates ($/day)
HANDYSIZE SUPRAMAX PANAMAX CAPESIZE
0
4,000
8,000
12,000
16,000
20,000
06/15 08/15 10/15 12/15 02/16 04/16 06/16
2 Year Atlantic TC Rates ($/day)
HANDYSIZE SUPRAMAX PANAMAX CAPESIZE
0
4,000
8,000
12,000
16,000
20,000
07/15 09/15 11/15 01/16 03/16 05/16 07/16
2 Year Paci fic TC Rates ($/day)
HANDYSIZE SUPRAMAX PANAMAX CAPESIZE
0
4,000
8,000
12,000
16,000
20,000
06/15 08/15 10/15 12/15 02/16 04/16 06/16
1 Year Paci fic TC Rates ($/day)
HANDYSIZE SUPRAMAX PANAMAX CAPESIZE
0
4,000
8,000
12,000
16,000
20,000
06/15 08/15 10/15 12/15 02/16 04/16 06/16
1 Year Atlantic TC Rates ($/day)
HANDYSIZE SUPRAMAX PANAMAX CAPESIZE
VESSEL SIZE (DWT) BUILT PERIOD DELIVERY RATE ($/DAY) CHRTR
ORMONT 181 2015 6-10 MOS 10,000 CARGILL
ALPHA HOPE 181 2011 7-9 MOS 10,000 CARGILL
MYNIKA 84 2013 4-8 MOS DAHEJ 5,700 CNR
BW ACORN 82 2010 12/12 MOS 6,000/7,000 GLENCORE
CEMTEX CREATION 82 2013 4-8 MOS DALIAN 5,850 LOUIS DREYFUS
YANGTZE 8 64 2015 4-6 MOS CJK 7,000 PACIFIC BASIN
ORIENT LUKCY 57 2010 4-6 MOS SHANGHAI 5,750 CARGILL
HEROIC STRIKER 57 2010 4-6 MOS RIO HAINA 10,000 WESTERN BULK
NAVIOS ULYSSES 56 2007 5 MOS USG 10,900 BUNGE
PERIOD FIXTURES
ALIBRA Weekly Market Report - 01 July 2016
Private and Confidential - ALIBRA Shipping Ltd. 2016 5
THIS WEEK LAST WEEK CHANGE (+/-)
DIRTY 691 713 -22
CLEAN 464 442 22
BALTIC TANKER INDEX
CPP/DPP & Crude
400
500
600
700
800
900
1000
1100
07/15 09/15 11/15 01/16 03/16 05/16
DIRTY CLEAN
SIZE
HANDY 14,250 14,750 15,500 14,500
MR IMO3 15,250 15,750 15,850 15,450
LR1 17,500 18,500 18,200 18,750
LR2 (115 dwt cpp & dpp) 23,000 22,750 22,000 24,000
AFRA (115dwt) 22,500 22,000 21,500 22,500
SUEZ 27,000 27,000 27,000 26,500
VLCC 38,500 37,500 36,000 35,500
* Arrows only indicate the movement compared to the past week hence not necessarily the market trends.
1 YR 2 YR 3 YR 5 YR
$0 $10,000 $20,000 $30,000 $40,000
1
2
3
5
PER
IOD
(Y
RS)
Term Structures
VLCC SUEZ AFRA LR2 LR1 MR HANDY
TANKER TIME CHARTER ESTIMATES (pdpr) NON—ECO TONNAGE
ALIBRA Weekly Market Report - 01 July 2016
Private and Confidential - ALIBRA Shipping Ltd. 2016 6
COMMENT
The effect of the Brexit is still uncertain. Brent oil dropped to a 7-week low on Monday but the
shock has since steadied with price standing at 48.39USD/bbl as of Wednesday.
Meanwhile the newly expanded Panama Canal is expected to ease US energy transport from
the US East Coast towards Asia, says Fitch.
Tanker sector still in cold state whilst everyone is waiting for a signal to happen.
Period VLCC rates are still moving downwards hovering at around $38,500/day this week.
10,000
20,000
30,000
40,000
50,000
60,000
07/15 09/15 11/15 01/16 03/16 05/16 07/16
1 Year TC Rates ($/day)
HANDY MR LR1 LR2 AFRA SUEZ VLCC
10,000
20,000
30,000
40,000
50,000
07/15 09/15 11/15 01/16 03/16 05/16 07/16
2 Year TC Rates ($/day)
HANDY MR LR1 LR2 AFRA SUEZ VLCC
10,000
20,000
30,000
40,000
50,000
07/15 09/15 11/15 01/16 03/16 05/16 07/16
3 Year TC Rates ($/day)
HANDY MR LR1 LR2 AFRA SUEZ VLCC
10,000
20,000
30,000
40,000
50,000
07/15 09/15 11/15 01/16 03/16 05/16 07/16
5 Year TC Rates ($/day)
HANDY MR LR1 LR2 AFRA SUEZ VLCC
VESSEL SIZE (DWT) BUILT PERIOD RATE ($/DAY) CHRTR
UNITED EMBLEM 161 2010 1-3 MOS RNR ST SHIPPING
CAPTAIN PARIS 115 2014 1 YR 21,500 NAVIG8
UNITED GRACE 112 2010 1-3 MOS RNR ST SHIPPING
CS STEALTH 105 2006 6 MOS RNR VITOL
MISS BENEDETTA 51 2012 6 MOS 14,750 FRONTLINE
ZEFYROS 50 2013 1 + 1 YR 14,500 SCORPIO
JAG PADMA 48 2003 1 YR 17,000 HINDUSTAN PETROLEUM
PERIOD FIXTURES
ALIBRA Weekly Market Report - 01 July 2016
Private and Confidential - ALIBRA Shipping Ltd. 2016 7
0
5
10
15
20
25
30
35
CAPE PANA SUPRA HANDY
$ M
ILLI
ON
Dry S&P Estimates
0 yrs 5 yrs 10 yrs
Sale and Purchase
0
20
40
60
80
100
VLCC SUEZ AFRA LR1 MR
$ M
ILLI
ON
Tanker S&P Estimates
0 yrs 5 yrs 10 yrs
2013 2014 2015 2016
DRY 449 400 295 250
WET 476 420 310 280
DEMOLITION PRICES ($/ldt)
VESSEL DWT BUILT PRICE ($M) BUYER
SHOSHONE SPIRIT 320 2011 62.0 ALPHA
ALAM BISTARI 47 2001 12.3 MIDDLE EASTERN
BLS LIWA 47 2008 22.0 PVT
BLS RUWAIS 47 2008 22.0 PVT
DL SUNFLOWER 45 1998 8.5 TAIWANESE
IKAN SUDIP 36 2008 9.5 AKIJ
GREAT STAR 25 1991 3.1 PVT
AS OPHELIA 20 2006 19.3 GREEK
CRANE HARMONY 12 2009 12.0 PVT
GOLDEN WAVE 9 2002 8.2 CHINESE
WET S&P
VESSEL DWT BUILT PRICE ($M) BUYER
CAPE ALTHEA 179 2011 24.4 GREAT EASTERN SHIPPING
KEY BOUNDARY 83 2010 13.7 BW GROUP
MOLLY MANX 58 2010 10.7 GREEK
JIN RONG 50 2000 3.4 HONG KONG
QUINN J 35 2011 9.5 GREEK
ORIENTAL SAPPHIRE 17 2003 2.8 RUSSIAN
ORIENTAL VEGA 17 2007 3.8 RUSSIAN
MARINE DIAMOND 10 2005 3.7 PVT
DRY S&P
ALIBRA Weekly Market Report - 01 July 2016
Private and Confidential - ALIBRA Shipping Ltd. 2016 8
$4,500
$5,000
$5,500
$6,000
$6,500
$7,000
$7,500
$8,000
$8,500
6 MOS 12 MOS 18 MOS 24 MOS
DRY FFA
HANDY SUPRA PANA CAPE
0 10,000 20,000 30,000 40,000
1
MOS
2
MOS
3
MOS
12
MOS
WET FFA
TD3 TD7 TC2 TC6
FFAs
ALIBRA SHIPPING LIMITED
1st Floor, 35 Thurloe Street, South Kensington, SW7 2LQ
LONDON
Tel: + 44 (0) 20 7581 7766 [email protected] [email protected] [email protected]
Fax: + 44 (0) 20 7581 7760 [email protected]
[email protected] [email protected]
HANDY SUPRA PANA CAPE
6 MOS 5,250 6,500 6,150 8,300
12 MOS 5,100 6,150 6,000 7,300
24 MOS 5,200 6,400 6,300 8,000
FFA DRY
TD3 TD7 TC2 TC6
1 MOS 24,850 19,400 7,050 9,650
2 MOS 23,800 19,300 7,350 9,950
3 MOS 23,700 19,200 7,000 9,750
12 MOS 26,450 24,850 7,550 11,200
WET FFA
DISCLAIMER
All the information disclosed in this report is given in good faith but without guarantee, based on the current market situat ion at the time of writing.
While all reasonable care has been taken in the preparation of this report, ALIBRA Shipping Ltd. does not accept any liability whatsoever for any
errors, omissions or opinions contained within this report.
None of the information contained in this report constitutes or forms an invitation or inducement to engage in investment activity.
This report is destined to the email recipient account only, and must not be passed on to any third parties whatsoever without the written consent
of ALIBRA Shipping Ltd. The information in this report may not be reproduced in any format without prior written approval from ALIBRA Shipping
Ltd.